Tag Archives: logistics

The 10 most innovative logistics companies of 2021

The Fast Company provides numerous top-10 rankings for the most innovative companies by categories such as, architecture, beauty, robotics, gaming, energy, logistics and others that you can find in their website.
This article introduce 10 Logistic Companies that have applied innovation in their procesess, products or services, to provide solutions during 2020 -a challenging year even for innovators- and at the same time, gives interesting examples of how logistics can be applied in a wide variety of industries in different stages of the value chain. Visit their websites to get more info!

1. GOTRG

“Reverse logistics” company goTRG specializes in helping retailers to reshelve, reclaim, and repurpose returned inventory. In 2020, the company launched several dedicated TV refurbishment centers at a major US retailer, redirecting hundreds of thousands of units out of landfills and into resale streams.

2. COUPA

Its new offering, Source Together, allows buyers seeking the same products to band together on “community sourcing events” to collectively choose, bid on, and award contracts, reducing their rates and providing suppliers with larger orders.

3. NARVAR

In response to the pandemic, Narvar rapidly rolled out solutions for companies facing store shutdowns, including returning in-store purchases through the mail, pivoting stores to ship merchandise, facilitating buy-online-pickup-curbside options, and expanding paperless returns (using a QR code) to all three major U.S. mail carriers.

4. VECNA ROBOTICS

With the release of Pivotal, a “multi-agent AI-based orchestration engine,” the company introduced the ability for clients to quickly and effectively coordinate and delegate work for both human and robot workers, reportedly helping clients double throughput.

5. PROGLOVE

In 2020 wearable scanner company ProGlove released the Mark Display, a matchbox-sized scanner and screen that, via a glove, mounts on the back of warehouse workers’ hands for simple, lightweight scanning.

6. CAHOOT

Cahoot’s Shipping Label Solution helps members analyze all combinations of fulfillment location, shipping distance, and cost to surface the cheapest way to get product to customers on time. This year it grew to more than 100 peer-to-peer merchants, and and moved more than $300 million in product.

7. BREAKTHROUGH

Breakthrough’s Network Intelligence system (launched in 2020) allows shippers to dynamically engage with their contract carriers, adding or removing partners as needed. The company’s dashboard houses thousands of data points about trucking companies, allowing clients to evaluate potential partners based on cost, speed, or quantity, and surfacing AI recommendations based on their priorities.

8. SHIPBOB

ShipBob fulfills orders for more than 3,500 DTC merchants. In 2020, the company expanded to international fulfillment centers, added free analytics tools to estimate shipping times and costs, and introduced new integrations with Loop, Shopify, Squarespace, Google and eBay.

9. RANPAK

In 2020, it introduced three paper-based solutions to its suite of eco-friendly shipping products: AccuFill, an automated system for cushioning packages that ensures just enough paper filler is used to be effective; PadPak Guardian, a machine that quickly and easily pads light and heavy items with paper bundles; and FillPak Trident, a paper alternative to plastic packing pillows.

10. 3RD STONE DESIGN

In 2020, 3rd Stone Design was awarded from the Bill & Melinda Gates Foundation’s Global Grand Challenges for its Stone Cold Systems for vaccine delivery. The battery-powered portable vaccine refrigerators, designed for deployment in low- and middle-income countries, keep medical products cold without the use of electricity, and can be remotely monitored for temperature and location.

the race for covid-19 inoculation

At the beginning of the pandemic, the global objective was to “flatten the curve” of contagions. One year later, the objective is to “accelerate the curve” of vaccination to achieve immunity in the shortest time possible, a medical and logistical challenge at global scale.

Eyes are on the global race to vaccinate the population to stop the advance of the Coronavirus pandemic. Until March 31, 2021, a total of 595.92 million vaccines have been administered globally acccording Our World in Data.

The total number of vaccination administered give us a preliminar idea of what is happening but, do not reflect the number of people vaccinated because most of the vaccines available needs two doses to generate the desired immunity. In the following graph we can see the share of population by country that at least have recieve one dose of vaccination.

From there, we can analyze possible factors that might caused that some countries, such as Chile have already reached the 35% of the population in their vaccination campaign, aiming the ambicious objective of reaching 80% of population by the first semester of 2021.

Sanitary and logistical capacity installed to be able to carry out mass vaccinations.

A system that is based on a strong network of primary health care centers at the city council level makes it easy to create a calendar according to the age of the population in order to prioritize patients who are older and at risk of disease, also seen in Israel strategy. Nevertheless, health centers and hospitals are not enough, specially when the sanitary system its reaching limits as consequence of the outbreak.

For Chilean politician, the logistics plan must include the use of adapted areas, such as: schools, colleges, public gyms, stadiums, and even drive-in’s were up to four people can recieve the shot. In this logistic bet, dozens of vehicles line up to enter a health circuit where the first stop is vaccination and the second, a parking lot, which functions as an observation area for possible adverse reactions. For them, the aim is to multiply the number of people vaccinated, reaching 15.000 vaccination centers, and being able to inoculate up to 319,014 people in a day.

Vaccination Drive in’s in Chile.
Massive and diversified purchasing strategy to have vaccine availability.

Diversification of suppliers has worked in the midst of a global context of limited distribution, especially for those high-income countries that bet only on vaccines produced in the West. In the contrary, the case of Chile, which vaccinates 3 times faster than Spain, has reached agreements for the acquisition of 36 million vaccines and has already bought the companies Pfizer and Johnson & Johnson, Sinovac, AstraZeneca and they are still in negotiation processes for the purchase of Sputnik V and Cansino to ensure availability of supplies, in addition to be part of the Covax program. The European Union, for its part, bet mainly on AstraZeneca and Pfizer, which have had logistical problems to produce and deliver the committed quantities, with contracts that favor them in these cases and with agreed quarterly deliveries, added to the preventive suspension of the vaccination for 2 weeks due to suspected side effects, causing a delay in vaccination throughout the region.

Mobilise all available resources

About 3.7 billion of the 6.8 billion doses of vaccines have been purchased by wealthy countries, according to an analysis by Duke University. Those who have been able to negotiate purchases by investing large amounts of public funds and generating price and volume agreements. Then there are the middle-income countries, which, with limited purchasing power, use other strategies to get ahead of the line, such as India and Brazil, which have managed to negotiate large commitments for the main vaccine candidates as part of the agreements. manufacturing.

There is also the case of Chile, which, although it does not have the capacity to manufacture or develop vaccines, can host clinical trials, which has allowed it to negotiate purchase agreements, and despite being the second most unequal country in the OECD, only behind Mexico, it has privileged resources and extensive business connections with vaccine producing countries.

Global logistic challenge

Imperial College of London researchers say integrated modelling for accurated prediction on how optimize procesess and flexible planning approach to multifactorial problems will be essential for manufacturers to meet the global COVID-19 vaccine demand.

In the current climate supply chains could face significant disruption from closed borders and limited international travel and transportation and additional pressures caused if personnel cannot work due to health issues, or if production processes break down. Their expert recommendation is: Optimising production, It is essential that manufacturers tackle capacity limitations and identify an efficient strategy that will enable them to be effective. Scale-out of manufacturing reduces the risk of losing production and supply capacity, by increasing the availability of operational facilities over a wider geographic area. This means that if one facility fails, others will be able to continue with production. Re-routing supply chains and distribution networks  it’s vital that supply chain networks are agile and flexible to mitigate risks related to route, and to be responsive to needs. In the early stages, vaccine availability will be insufficient to immediately cover global demand, so strategies will have to be decided at governmental and global levels to decide who will be prioritised for the initial doses. This will define the target for the supply chain and will change over time.

The first chamber of Ocado’s robot warehouse system

Just it sounds the swoosh of wheels from 1,100 waist-high cuboid swarm robots, zipping along a grid system the size of several football pitches. The robots collect groceries from crates beneath them, and drop them off at a packing station.

Occasionally they would all simultaneously come to a halt, green lights blinking, awaiting their next command, received via an unofficial 4G network custom-built by Ocado.

Underneath them, side-by-side with humans, another robot consisting of only one arm was being trained to pack the goods gathered by the swarm to fulfil individual orders.

The chill the temperature was to protect the cold food. There’s a good reason why data centres full of computer servers are often built inside icy mountains or under oceans. Electronics get hot.

Ocado is a significant tech firm that has invested millions in developing robotics with the ambition of becoming a people-free platform.

That means that from the moment you place your online order to the moment it arrives at your door (via a driverless van of course), there will be no human intervention.

The plant process 65,000 orders per week.

This technology was described as part-robot, part-phone, because of their 4G communications.

Ocado’s facilities

Iot a game-changer in distribution network

The Internet of Things is connecting more and more devices every day, industries are implementing IoT to improve their efficiency and decision making. The number of connected devices in 2017 was larger than the global population with more than 8.4 billion.

Logistic companies like DHL are using IoT, to access to information of their workers to provide a safe working environment. Also companies with different types of distribution network, retail, wholesales, last mile, drop-off, like Walmart, Costco, Mercadona and Amazon, are implement IoT to take advantage of the data.

The IoT can be used in different sectors,this will improve the visibility and monitor the location of goods, people and trucks. The IoT improves the asset management, delivery, and supply chain, will provide the analytics to generate information, predictability and new business value and revenue.

Poh Khai, Senior Innovation Manager, at DHL said: “By exploring the use of IoT across our warehousing, logistics, and transportation systems, we can analyze the data generated at every critical point to identify ways to better manage inventory, better predict system maintenance, and better monitor and control supply chains. …. It strengthens our ability to ‘sense’ and improve our environment, turning data into valuable and actionable insights”

For more information, you can visit these articles

https://lot.dhl.com/harnessing-the-power-of-iot-for-the-logistics-industry/

https://www.sigfox.com/en/new-iot-powered-supply-chain-how-smart-logistics-tracking-creating-leaner-more-agile-global-economy

FASHION PUTS ITS LOGISTICAL CAPACITY AT THE SERVICE OF THE GOVERNMENT

The fashion giant Inditex will donate around 300,000 surgical protective masks to the Spanish state and is exploring giving up part of its textile manufacturing capacity for the manufacture of medical equipment. This week we have studied concepts of distribution networks, but in this post I would like to emphasize that the situation in Spain and in some countries of the world is so critical that the inventory of sanitary material is… COMPLETELY NON-EXISTENT.

Zara returns to its origins, but this time to fight the COVID-19

The production lines work against the clock, countries like China are starting to send quantities of gowns, masks, etc., to Spain, other countries like Italy, despite the aid received, are so many people infected by coronavirus that they do not have enough material to supply all those who need it.

Here is a link to a video of the mask production line:

Complete Automatic Face Mask Production Line

However, other designers integrated in ACME (Asociación de Creadores de Moda de España) such as Andrés Sarda or Dolores Cortés have also ceded their workshops for the production of sanitary ware. All united in the fight against the same enemy.

If you want more information I leave you several links that deal with the subject.

www.lavanguardia.com/vida/20200319/474260118566/firmas-de-moda-ponen-a-disposicion-sus-talleres-fabricar-material-sanitario.html

www.expansion.com/empresas/distribucion/2020/03/18/5e725516e5fdea2c468b45ce.html

Uk, THE NEW LOGISTIC MANUFACTURER AGAINST THE COVID-19

In the midst of panic and confinement situation, measures taken from the government leaders of the different nations, the concern of the British state about a shortage of medical equipment arises, which forces the Prime Minister Boris Johnson to call urgently to the manufacturing industry.

Call for businesses to help make NHS ventilators

The aim is to increase production by making immediate changes to production lines, something that not all companies consider ready. However, time is running out, and every minute is gold, it is wartime, and it has to be made to work.

Ventilators are vital in the treatment of patients whose lungs have been attacked by the infection. The health secretary told that the country currently has 5,000 ventilators but said it would need “many times more than that”.

Interview Health Secretary Matt Hancock

But questions remain over how engineering firms with no experience of producing ventilators will be able start manufacturing the complex medical devices.

The use of NHS ventilators means that twice as much space must be used as usual, in the face of the collapse of hospitals. For this reason, the Best Westen hotel chain has ceded its rooms and other facilities to the government in case they were needed. In short, the United Kingdom wants to be prepared to face this health crisis.

I encourage you to comment on “ingenious” measures with which your countries will be alleviated from the lack of logistics that COVID-19 has created.

And if you are interested in knowing more about the news I recommend the following links and sources of the post:

Why doesn’t the UK have enough NHS ventilators?

www.bbc.com/news/business-51896168

online shopping increase due to coronavirus

As we have seen in class and as @CMERIZALDE has mentioned in the previous post, inventory control is really important for a company and there are different ways of controlling it. Nevertheless, when society is suffering from panic, like coronavirus they begin to do panic sales and the normal supply grocery stores are receiving is not enough, the company will experience shortages. In a lot of countries, shelves are getting empty. In my case, I have seen photos of supermarkets in Spain, Mexico, the US, Ecuador, Dominican Republic and Peru, empty, without toilet paper, water, tuna, rice, and other nonperishable goods, the panic sales don´t give time to supermarkets to replenish the shelves and their logistics system are oversaturated.

As another option, people are using technology to avoid doing physical contact and are trying to buy online groceries. Mercadona, Carrefour and Corte Inglés, among others have experienced an increase of 138% in the week of February 24 and March 1, due to the overdemand, they have been hiring temporary workers to try to satisfy it, but in some cases like in Madrid, Mercadona cancel the sales because they were not able to warranty the deliveries. In other cases, Dia and Carrefour are limiting their services to “the one that most needed” like people over 60 years old.

Additionally to groceries, other sectors have experienced an increase in demand, clothes stores like Mango and Zara had an increase in their online sales, one of the reasons is because their physical stores are closed due to quarantine. Similarly, technology stores have experienced an increase in their online shopping, the most popular products are video games, computers, tablets and TVs. It´s important to mentioned that delivery guys are one of the people that will be more at risk due to their exposure.

Here are more news if you are interested in the subjetc.

https://smoda.elpais.com/moda/actualidad/compras-online-coronavirus/

https://www.modaes.es/entorno/coronavirus-y-si-ni-el-ecommerce-salva-a-la-moda.html

5G technology will change the logistics industry

What is 5G?

5G Network (5G Network) is the fifth generation mobile communication network. Its peak theoretical transmission speed can reach 1GB every 8 seconds. Compared with a 4G network with a peak of 100Mbps, the transmission speed is hundreds of times faster. 4G networks have been in use for a long time, and have provided us with important changes such as taxi rides, mobile payments, and mobile navigation.

It is not difficult to imagine that the arrival of the 5G era will bring about drastic changes in our lives. But what changes will 5G cause to the logistics industry? Its huge impact is mainly reflected in the following three aspects.

1.In transportation

5G can provide wider network coverage in urban or rural areas. It enables “vehicle to all” (V2X) applications, which will enable continuous monitoring, tracking and theft detection of the logistics and supply chain industries. Furthermore, more driverless cars can be applied to the logistics and distribution process. The “zero” delay characteristic of 5G networks can also greatly reduce the risk of driverless cars in traffic accidents.

2. In the warehouse

Numerous surveillance cameras are currently distributed in logistics parks or warehouses around the world. Relying on high-speed 5G networks, these cameras will be upgraded from simple surveillance shooting functions to intelligent perception systems. Integrating technologies such as cloud computing, big data, and AI to realise full-process visualisation, which enables real-time monitoring, analysis, calculation, and early warning of the operation process.

3. During delivery

In addition to the aforementioned unmanned driving can be used in logistics distribution scenarios, drones will also rely on the popularity of 5G networks to develop rapidly. The current test scenarios of drones are mostly distribution in remote areas, because the electromagnetic environment in urban distribution scenarios is complex and high-rise buildings, which place higher requirements on the navigation, accuracy and anti-interference of drones. Relying on the high bandwidth, low latency, and anti-interference of 5G networks, it will be assisted on the basis of GPS navigation, and can further improve the machine vision ability.

“5G brings a comprehensive change of path to digital logistics and supply chain services. But technology adaptation is a gradual process for many people. In this process, training new logistics talents and upgrading the capabilities of the team are very important.”

sold out!!!!

In every store, in every community, in every place….from all over the world store there is a key product that rather than seeing that its sales are falling day by day, experience the precise opposite.

Mercadona Perfumery aisle shelves (Valencia) and (Madrid)

They are the famous hand-cleaning gels, already known during the past illnesses: “Bird flu”, or “Ébola”, which are supposed to disinfect and kill the microorganisms they come into contact with. And they are among the first products to be sold out in supermarkets around the world. Currently, with the Coronavirus, the image of empty shelves is an evidence of the social alarm that has been triggered among citizens.

Despite the wide variety of gels offered by supermarkets, the out-of-stock sign is the new double-edged sword for the economy of certain companies.

Hand-cleaning gels (Mercadona)

I am not a luggage

I want to share with you the situation which took place in January in Russia in flight from New York to Sofia via Moscow.

Passenger Maxim Chumachenko handed over the carrying with three cats to the luggage compartment in accordance with Aeroflot rules. Based on the norms, it is forbidden to take animals with you into the cabin, whose weight together with the container exceeds 8 kilograms.

When unloading luggage at Sheremetyevo, ”, another passenger flying the same flight told Chumachenko that cats were “thrown. He ran to the Aeroflot counter and asked where the animals were. He also asked why the cargo was not served one of the first, even though he paid for this service. “There they mumbled something to me that our animals were the last to board,” he said.

Chumachenko received broken carryings with cats from warehouse employees: one of them had a “bottom gone to the ceiling,” so they tied it up with a rope on top. The passenger was allowed to take cats into the cabin, but they died anyway: one on a plane from Moscow to Sofia, the other on the table at the veterinarian after landing.

According to preliminary conclusions, both pets died from internal hemorrhage, which provoked injuries received during transportation.

The third cat flew a transfer from New York to Sofia, so the owner did not know about her fate. She survived, but, judging by the diagnosis from the veterinarian, she received a frostbite.

Russian airline Aeroflot has become a target for social media criticism. The airlines themselves began to criticize airport workers, because it was, they who transported from one plane to another.

In addition to the disgusting treatment of animals by both guilty parties, they are trying to shift responsibility to each other.

Based on the method “problem/not a problem” analysis performed in the class, you can clearly see how this problem was not a significant problem until a tragic incident occurred.

Passengers have always talked about the incredible difficulties in transporting animals related to documentation, booking a seat in the cabin or in the luggage compartment, with a considerable amount of information and requirements for carrying the animal.

In response, the owner of an animal did not receive the necessary information about where and how the animal is transported, never were published some photos of the place of animals in the airplane and never were published the conditions in which the animal is during the trip.

In the modern world, according to statistics, every second habitant of the planet has a cat or dog. And it is accurate and understandable that they have the right to be transported under conditions, if not equated to human, then at least in those that do not threaten their life and health physical and psychological.

After the cats’ deaths, Russian users took to Aeroflot’s social media pages to leave negative comments, many of them were deleted. Soon, the comments transformed into a flashmob of photos showing pets in suitcases next to a sign saying “I’m not luggage. I’m a passenger!”

I can describe my experience with transporting my cat to Valencia. We flew three times with 2 different airlines, one of which was Aeroflot. 3 times I was presented with 3 different rules on the characteristics that a cat carrier should have so that I can take it with me to the salon. And if in the case of the S7 airline, which we flew twice, the airline’s employees were sympathetic to the fact that it is impossible to place an adult cat with the declared 20 cm, which should be a box for the cat , even if it is up to 4 kg, then in the case of Aeroflot wanted to put on a flight. Since the cat, along with the carrying, did not exceed the norm for carriage in the salon (up to 8 kg with Aeroflot), I refused to send him in luggage. During long negotiations and calls to the support service, and without having received permission to go through, I bought the 3rd carrier at the airport from the airline, which has an international standard for its branded transportation boxes for animals. However, this standard did not meet the Aeroflot standard, but it corresponded to the international standard, I managed to get into the salon with such a transfer and place it under the seat in front of the standing chair.

– All airlines set their own standard for transporting animals on an airplane, both for the cabin and for the luggage compartment, which they themselves do not always adhere to.

– Although you pay for the transportation of the animal, the animal is perceived as well as luggage, and also stands as an additional “non-standard baggage”.

-For the transportation of an animal, a lot of certificates should be presented, both at the exit and at the entrance, subject to its health, i.e. if the animal is sick, then it cannot move with its owner. While for people there is absolutely no medical check before boarding a flight.

Even in the course of the situation with coronavirus escalated in Europe, on the day this post was written 24/02/20 in Spain and in particular in Valencia there is not a single control over visitors. In this example, I can only note this airport, since it was precisely today that my friend flew from Russia to Valencia.

https://www.themoscowtimes.com/2020/01/27/aeroflot-sheremetyevo-under-fire-for-cat-passengers-deaths-a69049

https://www.themoscowtimes.com/2020/01/28/im-not-baggage-russian-pets-unite-in-flashmob-after-cats-airplane-death-a69064

Coronavirus and logistics

Hi! I want to talk about a recent and popular topic, the Coronavirus and how this had affected the logistics and supply chain of many enterprises around the world, not only China. Wuhan is the capital of Hubei province, it was considered the political, economic, financial and commercial center of Central China, and was a major transportation hub that connected with other major cities. Wuhan is the most populous city in Central China, with a population of 9.8 million, has more than 6000 enterprises from over 80 countries, major industries include optical-electronics, automobile, iron, and steel manufacturing.

How coronavirus has affected logistics? On one hand, due to the coronavirus outbreak, the city has stopped its operations, most of the companies have shut down like PepsiCo, Siemens, Renault, Honda, and Peugeot Citroen, etc. The closure of the companies has affected national and international suppliers, transportation companies, employees, that have stopped operations due to orders cancellations.

Video showing the mask scarcity in Japan. Empty shelters.

On the other hand, there has been a shortage of products like food and masks. Masks and alcohol have increased the demand exponentially, national and international companies had at least double the production, are working 3 shifts a day, 7 days a week to increase the supply of these products in China, Japan, and countries that have coronavirus cases. How are been delivered? Logistics and transportation never stop, in Wuhan, these people are still working. In the case of food, there has been an increase in online orders, so people can receive their groceries at home and don´t have to get out of their homes. In the case of masks, alcohol, and medicine, the routes of transportation have increased, by truck, automobile, bicycle, and by foot.

Transportation of Masks to the main hospitals in Wuhan
Grocery transportation of online orders

Although a lot of sectors are not working, transportation cannot stop, is a vital element in order to support society with medicines and food. There are a lot of things related to logistics that we can talk about, this is just a small summary of enormous impact of a SRAS in society.

References

https://www.prologis.com/industrial-logistics-warehouse-space/asia/china/wuhan-chinas-domestic-trade-hub

https://www.businessinsider.com/wuhan-coronavirus-which-companies-shut-down-operations-move-employees-2020-1?IR=T

https://www.businessinsider.com/alibaba-group-fights-coronavirus-new-platform-2020-2?IR=T

Traffic light logistics: when you become the package.

While I was studying my industrial electronics and automatics engineer degree, I had to program a cross street traffic lights for a simulation. The task was not particularly difficult (I was just programming a couple of traffic lights for an intersection), but it made me realize how difficult must be to control not just one intersection, but all of them in a big city like Valencia (or worse, Madrid).

Just in the same way in a warehouse you have to take into account the holding costs, in a intersection of streets, if the red-green light periods of the traffic lights are too long,  retentions will be created, and if they are too short, only a few cars, the ones in first line, will cross, due to the delay in the reaction time of the drivers. So a proper lenght has to be found, and it depends on the traffic flux, which is also dependent on the area, hour and day, so a constant revision of the periods is needed.

By the way, we don’t have to forget the yellow light. Sometimes are not needed, if there is no “dilemma zone“, but when needed, if it is too short, some drivers will cross in red and it may cause accidents (although it also increases ticket revenue if you put a camera).

A propper traffic light system is not a joke, the Los Angeles synchronized whole-city-traffic light system “increases travel speeds by 16 percent and reduce travel time by 12 percent. And because of reduced idling time, the city says it will save 1 million metric tons of carbon from entering the atmosphere”.

In case you wanna know a bit more about how all this works, here there is a video of the Los Angeles Department of Transportation Automated Traffic Surveillance and Control Center.

Hope next time you see a traffic light, you look at it with different eyes.

THE POWER OF A COCA COLA

Big companies are big for some reason. Today I want to speak about Coca Cola a big company with 500 brands and more than 3,500 products. The company, as can be seen in the figure, has approximately 24 million locations with more than 900 bottling plants. So, how can Coca Cola manage the product and information flows?

First of all, Coca Cola company prepares concentrates, syrups and beverage bases. It is also the responsible for consumer brand marketing initiatives. Then, these products are sold to bottling operations. Finally, the bottling partners of Coca Cola manufacture, package, merchandise and distribute the final product to the customers and vending partners, who then sell the branded beverages to consumers.

As can be deduced from the information above, the bottling partners of Coca Cola are one of the most important part of the chain. They work closely with restaurants, movie theaters, convenience stores, among many others and then these customers sell the product to the final consumer at a rate of more than 1.9 billion servings a day.

coca cola

Figure 1. Coca Cola logistics. Source: Own elaboration.

Another interesting point which make Coca Cola a successful company is the marketing. Coca Cola needs to transmit the power of a Coca Cola so it makes announcements to achieve this. Typically, it creates advertisements that try to reach people showing situations of everyday life. Coca Cola creates different ads depending on the country and the target segment.

According with all this information, two of the most important points of the company are the logistics which facilitates the management of the product flow and permits the availability of the products at the final store, and the marketing which transmits the information to the consumer.

References:

http://www.coca-colacompany.com/our-company/the-coca-cola-system

http://www.coca-colacompany.com/

 

Aurea Jordán

Big Data: opportunities to improve Logistics and Transportation performance

One of the pillars of Logistics is data. Collecting data is not the basis of this business but according with the previous posts is very important in order to answer the questions:

  1. How much do we store?
  2. How many movements per hour do we need?

On the one hand, due to the significance of this topic I would mix the knowledge acquired in class with my own experience. In my everyday activities I’m work with a lot of data: number of datasets, classification, type of content, among others. At this moment is quite interesting mediate about these topics related with Logistics. For example: number of pallets or boxes, classification in conveyors, type of content (liquid, solid, others), among others.

According to the visit of Richard Stallman’s (http://bit.ly/1TCp62n)  at the Polytechnic University of Valencia the past 05/16/2016, let me introduce this TEDx video: Free software, free society at TEDxGeneva 2014. This video shown the implications of free software and proprietary software and suggested interesting reflexions related with the property of this systems. See Video 1 (minutes 1:55-5:38).

Video 1. Free software. <https://youtu.be/Ag1AKIl_2GM> [Accessed: 05/17/2016].

On the other hand; open data, public sector information and big data represents one of the most valuable assets of public and private organizations in order to try give an answer to this open questions introduced before. This information supported by management tools which support information flows through the entire organization like Customer Relationship Management (CRM) or Enterprise Resource Planning (ERP) could dynamize the interexchange relation between customer and supplier. See Video 2 (08:00-10:00): Using Open Door Logistics and Geographic Data to Plan Routes. In addition, I recommend visualize the Video 3: Big Data and Transport (2 minutes).

Video 2. Big Data: datasets. <https://youtu.be/kGoAHczxOsA> [Accessed: 05/17/2016].

Video 3. Big Data: Transport. <https://youtu.be/VXjDhzWfCF4> [Accessed: 05/17/2016].

Datasets related with Logistics:

Finally, let me introduce the following topic: Is the Big Data the future of Logistics?

The big data could increase the velocity of communication, dynamize the volume of this communication and ensure their viability. Nowadays Big Data represents and strategic asset strategic asset to be considered by sustainable organizations. See Video 4 (2:21).

Video 4. Big Data: Logistics. <https://youtu.be/OCCIX1cnzbQ> [Accessed: 05/17/2016].

The hidden face of logistics

As we had the opportunity to see along all our posts, logistics is everywhere and forms part in many processes in a wide variety of sectors. As a consequence, the organs transplants are not an exception. Only in our country, more than 100.000 transplants had taken place since 1965 which is the year when this practice started. Time, as usually in logistics, plays an important role in a process where coordination between all the parts involved is crucial. The aim of this post is to give a basic idea of how it works the organs transplant and clarify the existent link between this and logistics.

In first place, the organs transplant is known as a complex medical treatment where organs, tissues or cells are transplanted from one person to other i.e. a damaged organ is substituted by one that functions correctly. The process starts when the donor has been diagnosed of encephalic death and a quick call has to be made to notify this fact so it is possible to start with the organization of the organs’ offer to the different transplant teams and prepare the operatives. There is a transplant coordinator who is responsible for providing the clinical, analytical and anthropometry data with the objective of facilitate the assessment of the possible use of the organs. All the data related with the steps of the transplant and the time that takes place is pointed in a dossier.

Video about organs transplants (1:52 – 3:45)

There are mainly four aspects where logistics is involved which are, in first place, the material means that are needed for the extraction of several organs, location of the personnel and coordination of the transport. Regarding the transport, the mechanism chosen for performing this task varies according the distance which is divided in:

  • Local donor: it is in the same city than the team on charge of the extraction and transplant but in different hospital. Therefore, the coordinator of the hospital organizes the displacement.
  • Short distance: sanitary cars or helicopters are used when the distance is lower than 200 km.
  • Long distance: private flight companies are hired and in some cases the air army realizes the transport. At least two hours are needed for preparing the flight so the coordination is essential between the hospitals involved and the ONT (National organization of transplants).

Secondly, it is important the preparation of the multiorgan extraction. The organ when is take from the body needs to be cooled, clean and preserved (the conditions will change in function of the organ or tissue). It is important to have a stock of the fluids used for the preservation, a sterile container and an isotainer for its transport. In addition, the third point consists on having good intrahospital coordination in the moment of the extraction. Moreover, the last step is based on the reposition of the stock.

material quirúrgico

Image 1: Surgical material needed for the organ transplant.

To sum up, the coordination of organs transplants involves a wide spectrum of aspects such as legal, clinical, organizational and human which takes place between hospitals and governmental institutions. There are evidences that point Spain as one of the countries with the most effective model of transplants. This success can be justified by the new surgical techniques and medical treatments together with an increase of organs donated. All this cannot be possible without logistics, which is responsible for the coordination of the transplant, the transport on time of the organ, the right stock repositioning, the use of a informatics system which is able of search information and channeling reports and requests for donor and transplant, among others.

 

DRONE, ANOTHER POINT OF VIEW

Nowadays drones appear as an innovative tool with many possibilities. One of the known uses of drones is as messaging tool for transporting products. According with this use, as my colleagues mentioned before, Amazon is working on the Prime Air program where the drones are used to deliver its products to the customers. But, can drones be used for another purpose?

At present, there are many companies which offers different services related with the use of drones. Being a flightless element with suitable proportions for carrying cameras and sensors, drones are used to take aerial images and videos. In the agricultural sector, drones are used for taking pictures of the field, create 3D maps, or for phytosanitary treatments. Drones can also be used as operational support to replace the use of helicopter monitoring for prevention and control of fires, people search or first aid transport, among others.

drone

Figure 1. Phytosanitary treatment with drone. Source: Reproduced from <http://www.dronetools.es/control-de-plagas-y-tratamientos-fitosanitarios/>

The different uses of drones explained before help the logistics of the companies. A drone reduces time of delivery and costs, improves the treatment of the field, generates more security and, in general, improves life of people.

One interesting application of drones is the delivery of drugs to remote places where the people can’t achieve medicines in winter due to the snow, or because they need to travel a lot of kilometers to arrive to a pharmacy, or maybe because they are too old. This is an interesting example where a technology facilitates the distribution and at the same time the life of people.

References:

http://www.amazon.com/b?node=8037720011

http://xn--airdroneespaa-tkb.com/

http://www.dronetools.es/aplicaciones/

http://www.dronplanet.com/servicios-drone/

Aurea Jordán

P:D ratio and order fulfillment options

Our discussions in class and our cases refer currently to the topic of process and time. We also talked about the P:D ratio and although this is a more theoretical topic, it is interesting to see what is behind it.

The production lead-time P describes how long it takes to manufacture a product and the demand lead-time D could be referred to as the lead time quoted by the firm to the customer. The comparison of P and D helps a company to select a suited strategic order fulfillment option (order fulfillment is the process a company responds to a customer’s order). The main difference between the options is the way that final users’ requirements are taken into consideration.

Post 4_Table

* Pull-type production:

  • production is based on actual demand
  • assembly / manufacturing process after receiving customer order à pulled by demand
  • quantity to produce per product specification is one / only a few

* Push-type production:

  • production is not based on actual demand
  • quantity to produce per product specification is high

 

See more:

http://www.lean-manufacturing-japan.com/scm-terminology/mto-make-to-order.html

http://www.arenasolutions.com/resources/articles/engineered-to-order/

https://en.wikipedia.org/wiki/Order_fulfillment

https://www.cairn.info/revue-projectique-2010-2-page-41.htm

Click to access ch10.pdf

http://slideplayer.com/slide/7940801/

Santa Claus Challenge

“Logistics doesn’t make happiness but can take it wherever is needed”

 

Regarding what professor José Pedro García wrote one day we want our colleagues to read our posts meanwhile they are waiting for the bus” I thought it could be interesting to write this time about how Santa Claus manage in modern times to deliver all the presents in Christmas. In addition, I consider that this topic is quite related with logistics. According to Unicef, there are 2.200 million of children in the world. Assuming that only the 50% of them are good kids and having in mind the world average of 2’5 children per house we can conclude that Santa Claus only needs to visit 440 millions of homes (if the good kids live together). Therefore, how he managed to guarantee that all the products are going to be delivered on time?

Nowadays Christmas campaign is not about one man flying during only 24 hours with reindeer from the headquarter in Lapland. In fact, there exist logistic centres around the world and the story behind this is more complex. Is more about designing a good business plan able to face this situation. Market research, planning, inventory, logistics and suppliers are some of the key words in this gear. During this period of time, logistics has a great relevance due the increase of commercial transactions and movement of products. Such is the case that hiring in companies of the logistic sector increase a 20% regarding the previous months.

Therefore, it can be observed a major volume of sales and as a consequence an increase of the work load. The latter affects specially transport companies which have to deliver a service with a high efficiency and great results but having the same resources of the rest of the year. Furthermore, time has an important role. The delivery of a product to a customer out of time can create a bad perception of the company. At the same time, it acquires a great value not to make mistakes in the delivery which can be avoid by using software like WMS (standard protocol for serving georeferenced map images which a map server generates using data from a GIS database), RFID technologies (allows contactless identification of objects using radio waves) or voice directed warehousing (use of speech recognition software in warehouses and distribution centers to make verbal orders)

To sum up, logistics have a huge impact in the results of cost, productivity, quality of the service and efficiency of the Christmas Campaign. It is related with the supplying, the management platform and the transport to stores. In addition, the logistics is responsible to determine the quantity needed for each product, to decide the volume of each product that each store should have and the right moment for this. To conclude, it can be said that the logistics involved in the Christmas Campaign maybe is not within reach of Santa Claus due it requires a huge planning of the supply chain and stock management.

papá noel

Image 1. Imports and exports. Icontainers. <http://www.icontainers.com/es/2015/12/03/la-logistica-de-papa-noel-en-el-s-xxi/&gt;. [Accessed: 16/03/16]

WORKSPACE DISTRIBUTION

When we study the process time we need to see the useless time to determine the improvements. One important aspect which can help us to reduce the useless time is the design of the workspace. We need to establish the area required based on the type of process or product offered, which influences the number of workers and machinery needed.

For the calculation of the workspace must be determined three surface types: static surface, gravitation surface and evolution surface. The static surface is occupied by the worker and machinery, gravitation surface is the necessary space to develop the work, and the evolution surface is the surface required for the routes of materials and workers. Thus the total area required to develop a job is given by the following formula:

Total surface = Static surface + Gravitation surface + Evolution Surface

To learn more about this calculation see the following document:  http://personales.upv.es/jpgarcia/LinkedDocuments/4%20Distribucion%20en%20planta.pdf  (p. 16 – 18)

We can see applied this knowledge to the mascletá (https://en.wikipedia.org/wiki/Masclet%C3%A0). The mascletà is performed in an enclosure, in front of Valencia town hall, in which the static surface would be determined by the workers, firecrackers and machines. The gravitation surface would be the full enclosure because, as you can see in the video, the workers move in the enclosure to provide the service. Finally, the evolution surface for this workspace would be the route that is done to move firecrackers from the factory to the town hall square and the pyrotechnical travel to the town hall balcony of Valencia.

In the same way, if you work in an office, the static surface would be formed by the worker, the desk, the computer and the office supplies. The gravitation surface would be the office, and the development surface could be the route that is performed to other offices, the printer or the room material.

office

Figure 1. Office distribution. Source: Own elaboration.

Outstanding image: Reproduced from <http://valenciaplaza.com/donde-ver-la-mascleta-online-en-directo>

Aurea Jordán

Border controls in Europe influence waiting times in logistics

“We are still able to keep our logistics running but we see increasing risks”, Dieter Zetsche (Chairman of Daimler AG and Head of Mercedes-Benz Cars)

Our last session in logistics was about process and time. We talked also about waiting times and I think this Is a really interesting topic and it’s getting even more interesting because of some current changes and new challenges. Due to the recently implemented border controls in a lot of European countries (remember: European refugee crisis) waiting hours are exploding and elaborated just-in-time processes of companies need to be adapted. So, the logistic sector is confronted with a new and challenging task.

For me it is interesting because my personal experience is related to this topic. In the past years it was so easy to go just for a lunch to Austria (if you are living close to the border), you didn’t nearly notice crossing the border. But the last weeks, it got more time intensive due to border controls and people sometimes decided not go to Austria because they did not want to be caught up in a traffic jam to come back to Germany. But what about the logistic sector? Companies cannot avoid crossing the border just because of waiting hours.

  • Trucks have to wait directly behind a border and wait for the permission to enter the country
  • Especially smaller trucks (7,5 t) are controlled (more than large trucks (40 t))
  • Especially the automotive sector is suffering due to just-in-time processes of parts, e.g. Daimler: Only just-in-time delivery, nearly no expensive warehouses, parts and semi-finished goods from all over the world are delivered directly to the assembly line
  • But also the transboundary trading with consumer goods is suffering
  • 1 hour of waiting at the border = ~ 50 € additional costs for logistic / transportation companies (according to German association of road haulage) and then they even have to pay again because if they cannot deliver the parts within a certain time frame, e.g. Daimler requests a penalty
  • > 2 hours traffic jam is critical because driving hours then get exceeded quickly, this results in more truck drivers’ rest periods and often the motorway service areas behind control stations are very crowded –> domino effect –> 2 hours traffic jam could result in 10-12 hours delay (according to Association Supply Chain Management, Purchasing and Logistics (BME)) –> abrupt increase of costs for haulers and in the end for the consumers
  • Also economic problems:
    • 57 Million international truck transports p.a. in the EU
    • 70 % of German foreign trade goes into the EU, 80 % of these imports and exports via the street

Conclusion: Border controls are confronting the logistic sector with a new challenge and can be expensive not only for companies but also for the population.

http://www.ozy.com/pov/the-hidden-economic-costs-to-border-controls/66234

http://www.deutschlandfunk.de/grenzkontrollen-der-wirtschaft-droht-ein-immenser-schaden.769.de.html?dram:article_id=343206

http://www.focus.de/finanzen/news/logistikbranche-geht-in-die-knie-grenzkontrollen-kosten-unternehmen-40-000-euro-pro-tag_id_5268112.html

THE FACILITY LOCATION

The location of a facility directly affects the logistics of a company. This affects the production system, the volume of production which will be manufactured and how it will be distributed. The location of an installation must be a strategic decision (long-term).

A new installation requires a major investment and also determines the competitiveness of the company (product costs, poor planning, operator costs, etc.). The location affects the operations department (transport), personnel, and finance, among others.

Starting-a-Business-Location

Source: Reproduced from <http://www.gaebler.com/Starting-a-Business-Location.htm&gt;. Accessed: 03/01/2016.

If a company has more distribution points, transport costs are lower but the cost of the facilities is higher. Therefore, it seeks to reach a point of equilibrium. When we choose the location we must take into account factors such as transport, labor supply, space for expansion, living conditions, among other factors.

Some important exact and heuristic (quantitative) methods used to select a location are: center of gravity method, factor – rating analysis, break – even analysis, and set covering models . We can also use other mathematical programming methods. To learn more about these methods, you can see the links below.

Center of gravity method http://www.shmula.com/distribution-center-location-optimizing-your-logistics-network/9312/
Factor – rating analysis http://www.prenhall.com/divisions/bp/app/russellcd/PROTECT/CHAPTERS/CHAP09/HEAD06.HTM
Break-Even analysis (pp. 81-84)

http://mde-lab.aegean.gr/images/stories/docs/HealthCare_FacilityLocation.pdf

Set covering models http://www.geog.ucsb.edu/~forest/G294download/MAX_COVER_RLC_CSR.pdf
Mathematical programming methods http://math.nsc.ru/LBRT/k5/Kochetov/Papers/Kochetov_Facility%20Location.pdf

Aurea Jordán

 

Digitalization and Big Data in Logistics

In the last lecture on February 26th, 2016 we defined logistic management as the management of material and information flow and talked about how the importance of the information flow has been underestimated for a long time. In my previous job as student research assistant I learned a lot about Industry 4.0 and digitalization which vastly increases the amount of data collected. This large amount of data is also called big data. The picture below shows how the amount of data will grow within the next years.

big data

source: http://www.emc.com/leadership/digital-universe/2014iview/executive-summary.htm

As it seems to be an important trend that affects logistics I decided to dig deeper into digitalization which enlarges the information flow in a significant matter.

I found a video about the trade fare “transport logistic 2015” for logistics, mobility, IT and supply chain management in Munich (https://www.youtube.com/watch?v=O7zLOriQ5FY). They show different examples on how real-time information can be used in order to increase transparency and efficiency and avoid unplanned costs for different transportation modes (minutes 1:39 until 2:55). At the end the Chairman of the Executive Board BVL concludes that a lot of things will change within the industry due to the ongoing digitalization. Moreover they assume that every third successful business model of today will probably no longer exist in 2020.

The video of BIBA (https://www.youtube.com/watch?v=uVcLbA2R9l8) talks more about the technologies that can be used in order to digitalize logistics. Currently telematics, RFID and various sensor systems are used to digitalize the physical logistic process. As nowadays the position of a vehicle is usually known they are now working on identifying the conditions of goods as well as possible manipulation of the good. Watch minutes 0:54 to 2:02 to see how this works.

All in all I can conclude that even though digitalization can pose a challenge at first it has the potential to improve logistics significantly and make our lives a lot easier.

The importance of time

The time in a company acquires a vital importance when there are many processes. The time is money invested in the workers, in the service or in the product, but we can spend this money in a profitable way or not. To understand the time of our process, there are three important visual techniques to plan the process: Gantt chart, Program Evaluation and Review Technique (PERT), and Critical Path Method (CPM).

The three techniques mentioned before show the time taken by each component of a process. The Gantt chart is an intuitive method and easy to interpret, but it doesn’t establish the relationship between activities, however, the PERT and the CPM method do it.  The CPM and PERT facilitate the critical path and the time which an activity can be lengthened without delaying the process.

These techniques are closely related with the logistics of a company because they are used to plan, to implement, and to coordinate a business. These tools become more important in the process when there are bottlenecks, processes using the same equipment, various processes in the same plant or processes on demand (we need to know when the product will be ready), among others.

If you want to learn more about these tools and how to use them there are more information in the links.

Gantt chart: What is a Gantt chart? http://www.gantt.com/

Gantt Chart Template for Excel: http://www.vertex42.com/ExcelTemplates/excel-gantt-chart.html

Program Evaluation and    Review Technique (PERT):

 

What is PERT? http://searchsoftwarequality.techtarget.com/definition/PERT-chart

http://www.referenceforbusiness.com/encyclopedia/Per-Pro/Program-Evaluation-and-Review-Technique-PERT.html

Steps in the PERT planning process:

http://www.netmba.com/operations/project/pert/

Critical Path Method (CPM):

 

What is CPM? http://hspm.sph.sc.edu/Courses/J716/CPM/CPM.html

Make a CPM (1’ – 5’): https://www.youtube.com/watch?v=SF53ZZsP4ik

Aurea Jordán Alfonso

Same Day Delivery

Last time we talked about the “Rodillas de Titano KaPeJu” Case in class and about the challenge that certain time lapses – for instance, the delivery time – need to be considered when ordering surgical material. This made me think about delivery time in general and how it is currently solved.

The same day delivery is an interesting and emerging topic within Logistics. Whereas 2012 50% of consumers were willing to wait a full week for free deliveries, it was only 35 % in 2014. So customers seem to get more impatient and demand short delivery times – even if they have to pay for it. The big E-Commerce retailers like Amazon or Ebay all offer same day delivery these days, even one-hour delivery services are offered. http://cerasis.com/2015/01/16/supply-chain-facts/

How can Amazon realize same day delivery?

If you order in the morning and pay the extra charge of 5.99 $ (as prime member) Amazon guarantees that you receive your package until 9 p.m. the same day (if your city is in the same day deliver offer included). https://www.youtube.com/watch?v=Cc2anPfCKFg. Amazon realizes that through investing in decentralized warehouses to establish next day delivery as standard and make same delivery an option for many.

Amazon Warehouseshttp://www.mckinsey.com/industries/travel-transport-and-logistics/our-insights/same-day-delivery-the-next-evolutionary-step-in-parcel-logistics

With the Amazon Prime Now App you can even order your stuff, be updated about the status and even the location of the courier in real time (it’s delivered by bicycle in the video) and you receive your order within one hour if you pay 7.99 $. (The video in this case is nice to watch and only about 1 minute: https://www.youtube.com/watch?v=ODLp4ZGQwzk)

The complex challenge of processing, fulfilling, and delivering an order within a few hours requires new types of networks. Current processes are often too slowly, fast and flexible couriers cannot handle big parcels. So the creation of a same-day delivery network comes at a high cost. Large volumes in each delivery district need to be achieved, which is difficult in the beginning anddepending on the operating modelmay require extensive upfront investment. Nonetheless, e.g. Amazon started creating networks capable of providing same-day delivery services at scale. Of course, this service is not yet available all over the country or for all items on Amazon. But the service is extending.

Zara’s logistics

Spanish population used to buy clothes with frequency even when they not necessarily need them. When we get inside a shop we just try to find something that we like and if we are agree with the price we limit to buy it but, do we really know what is behind all this? This is the question that I formulated to myself. Therefore, to understand a little more which are the processes needed to create and bring the clothes that I buy later in the shops, I decided to focus in Zara which is one of the brands that I like but more importantly, is one of the companies widely known by the efficiency of its logistic. To sum up, below you will be able to read a und understand better how it works a retail company.

Zara is a retailer which belongs to the INDITEX group.  It was created in 1975 in La Coruña and founded by Amancio Ortega.  Afterward, during the eighties, it was implemented a logistic system which fitted with the company and with its future projection.  Since then, the 3 important keys for their business are production, logistic and sales. This leads to them to be a good example of success, helping them to grow up as a company and expand around the globe.  Nowadays, Zara counts with more than 2000 shops distributed in 88 countries.

In addition, in Zara every distribution unit acts as an independent strategic business unit where each has its own goals and resources while the central services i.e. Business Support Area and Corporate Department and the governance are left to the hub. However, Zara keeps the control over the whole international chain with property stores, production plants and also almost every business partner and supplier.

zara headquarter

Image 1. Zara’s headquarter in Arteixo

In first place, in 2006 it was implemented a Store Management Terminals (TGT) composed by an informatics program which makes the information flow easily. Through this program, the store staff has access to every kind of information about the products, the warehouse and it is connected with other stores and their logistic center. Because of this, Zara knows at every moment what is going on in the stores around the world. It can obtain information about every piece that is sold and returned and even the stock available. As they know about the preferences of the consumers of each store basing on in which sizes, colors and pieces they sell more, they can stablish a rotation chain where the stores exchange products with others. The fast reposition leads to a reduction of the financial costs related to the storage and its maintaining.

After an order takes place, the products are disposed in boxes and introduced in a lorry which goes to the corresponding store.  Zara also counts with agreements with airlines to transport to the farthest places the pieces. In addition, the shipments are dispatched from the distribution center twice a week.  It passes only 24-48 hours to arrive to the store or 72 if the location of the store is more problematic. The sophisticated warehouses and a high delivery frequency with short lead times, are some of the factors that characterized Zara’s successful history.

Once the pieces arrive to the shop, the shop assistant has to place every piece in its place and ensure the correct disposition.

Another interesting point to be mentioned about clothes, is that Zara use fabric rather than yarn dyeing. This fact allows to postpone the uncertainty generated by the colors demand. Therefore, a wide color range can be offered with a short lead time.

In conclusion, Zara has been able to reduce the lead time by giving a quick response, achieving a close relationship between their different chains by the execution of integration strategies and to have the control of its suppliers. Moreover, Zara’s success is given by the strength of its chain of production and for the highly responsive logistic system. The logistic system is the link between the different processes of sales, production, design, supply and clothes rotation. In addition, their supply chain strategy is based in a fast response, acting instead of predicting which clothes will be more successfully sold and producing low quantities which lead to more options and a lower lead time.

To conclude, I´d like to recommend you to watch in La Sexta the tv program Salvados where it is exposed the other face of the retail industry. Below is the link of the whole program.

http://www.atresplayer.com/television/programas/salvados/temporada-11/capitulo-13-quin-cmo-dnde-fabrica-ropa-que-venden-grandes-marcas_2016021900402.html

 

 

References:

Agulló Fernández, I., 2012. Producir y consumir: la logística, clave del éxito de una cadena de moda. Política y Sociedad, 49(1), pp. 179-191.

Wageningen: Wageningen Academic Publishers, 2008. Proceedings of the 8th International Conference on management in Agrifood Chains and Networks, 28-30 May 2008, The Netherlands.

Completely Knocked Down. What does it mean and why is it used?

As we know, cars are produced all over the world. The well-known car-manufacturers assemble cars in different countries. Sometimes the necessary parts for the cars are shipped overseas from suppliers to the plants, sometimes suppliers are settled near the plant in the foreign country, and sometimes something completely different happens.

ckd

CKD is the keyword. CKD stands for Completely Knocked Down. The term  has its origin in the automotive industry and refers to a form of production of vehicles. The car manufacturer exports a not-assembled vehicle in the form of individual parts that is assembled into a finished vehicle in the respective country of import and sold there. In addition to individual parts also partially prefabricated vehicles are exported as Semi-Knocked Down (SKD) or  Medium-Knocked-Down (MKD).

Main reason for the CKD exports are mostly high import duties for complete end products, whereas partially dismantled or completely knocked down products have often considerably lower duties. Another reason is the start of local production, especially in emerging countries.

ckd2

So how does this procedure work? Just like your LEGO! At the car manufacturer, the body and corresponding individual parts are removed from the normal manufacturing sequence and packed. These parts will be sent to the destination country . Once there, the parts get assembled and completed with parts to meet the requirements of the country (local content).

The main advantage of CKD is the avoidance of high import duties on finished products (CBUs “Completely Built Units”). Non-European countries impose some duties between 30-300% of the value to protect the industry and therefore the jobs in their own country. In the disassembling of the product according to CDK-principle duties of only 25% of the goods value will be charged.

A major disadvantage in the choice of CDK strategy, the problem of shipping can be seen. The parts must be packaged individually or in groups and be sent. Defective, damaged or lost goods may delay the manufacturing process in the country. It must also be noted that the packaging material is expected to be in the calculation of the  production.

Pick-by-Vision – Augmented Reality in logistics

AR

(Referring to Comparing Picking Ways and Batch Picking Warehouse)

Pick-by-light and Pick-by-voice are two common technologies in warehousing operations which are used to do the order picking. These two systems already replaced the pick-by-paper approach, so order picking became paperless. This means higher accuracy, productivity and efficiency. But a new technology is approximating. Working with mobile augmented reality systems, head-mounted display cameras can improve the picking process even further.

Warehousing operations “are estimated to account for about 20 % of all logistics costs, and the  task of picking accounts for 55 % to 65 % of the total cost of warehousing operations. This indicates that AR (Augmented Reality) has the potential to significantly reduce cost by improving the picking process.” (See DHL.com).

The Pick-by-Vision system has extensive benefits compared to light or voice-directed solutions. As it can recognize the surroundings and show the operator visual information via See-Through-Display, it guides the operator through the warehouse reducing travel time by optimized route planning. Real-time object recognition and barcode reading with just one view make the handling of additional scanners dispensable. The software is integrated in the Warehouse-Management-System so booking of withdrawals is automated which enables real-time stock updates.

visionPicking02

Advantages of the Pick-by-Vision technology:

  • Training time required for operators minimized.
  • Language independent navigation within the warehouse.
  • Optical picking instructions replace paper, visual (lights) or voice-based directions.
  • Fully automatic tracking of serial numbers.
  • 100% error-free picking improves quality control.
  • Applicable in every warehouse without structural changes or other modifications.

(tum.de)

Overnight-Express or: How to order lobster from overseas

world-map

Do you know how long it takes to walk 1000 kilometers? I bet you don´t. Of course you could calculate it, for example by taking an average speed and adding some time for basic needs like sleeping and eating. I won´t tell you the question´s answer, but all of us know: it will take a lot of time. Next question: How long takes a flight from Madrid to New York City? Less than 9 hours you will say. And by the way, the distance is almost 6000 kilometers. The 100-year old invention of the airplane completely changed all our lives. The airplane connects the world. It plays an important role in freighting people as well as goods. The air freight has become indispensable for sending urgent as well as perishable cargo, because it is fast, reliable, and the freight is under controlled conditions. Some examples for delicate cargo: medical supplies, foods, animals.

Thanks to logistics engineers, who developed an all over the world perfectly working, highly sophisticated logistics-system based on IT-technologies, nowadays it is possible to receive a package from overseas within 24 hours. To make this possible, it is indispensable that all required steps interlock perfectly, beginning with the record of an order, to the delivery to the customer. Same for the information flow.  In one of the world´s largest air freight transshipment-centers, the DHL HUB Leipzig in Germany, 1500 tons of freight are transshipped per night. Of course every step has to work and there is no space for mistakes.

When starting its journey around the world, an express package like a coolbox containing lobsters will rarely stand still. The journey is planned from A to Z by an IT-System and it will be timed minutely. Do you still remember the question at the beginning of this text? The lobsters will be faster!